Climate Policy Engagement Analysis
Climate Policy Engagement Overview: The International Emissions Trading Association (IETA) is strategically engaged on climate policy, particularly on emissions trading policy. IETA has supported emissions trading systems in Europe, the US, and Canada, but has supported exceptions in some of their provisions that weaken the original climate ambition of the schemes.
Top-line Messaging on Climate Policy: IETA’s top-line communications on climate policy are broadly positive. The association expressed its support for reaching net-zero greenhouse gas (GHG) emissions by 2050 on its corporate website, accessed November 2023. Further, IETA CEO Dirk Forrister supported GHG emissions reductions in line with the 1.5°C target of the Paris Agreement in the association’s November 2022 GHG Market Report. IETA has consistently supported the completion of Article 6 of the Paris Agreement, for example in an October 2023 submission to the Article 6.4 Supervisory Body on the operation of Article 6.4.
Engagement with Climate-Related Regulations: IETA is actively engaged on emissions trading policy in Europe, the US, and Canada. Its engagements have been supportive of emissions trading policies, however the association also appears to support measures in some specific emissions trading schemes that would weaken their original climate ambition. In contrast, the association is not strongly engaged on other forms of climate-related regulations.
In Europe, IETA CEO Dirk Forrister supported extending the EU Emissions Trading System (ETS) to more sectors in a June 2022 GHG sentiment survey. Additionally, as reported in an August 2022 S&P Global article, IETA opposed the suspension of the EU ETS in response to the EU energy price crisis.
In the US, the association supported the creation of Washington's 'Cap-and-Invest' Program, and supported the linkage of the program to California's Cap-and-Trade System in January 2022 comments on Washington's Cap-and-Invest rulemaking. However, the association has used support for specific emissions trading schemes to oppose other forms of climate policy in the US. For example, in its December 2022 GHG Market Report, IETA used its support for California's Cap-and-Trade Program to oppose other direct climate regulations and subsidies in the state.
Furthermore, in Canada, while the association has supported Canada’s Output Based Pricing System (OBPS), such as in a September 2021 consultation submission, more recently it appears to have expressed less positive positions. For example, in a January 2022 consultation paper to Environment and Climate Change Canada (ECCC), IETA supported Canada's OBPS but called for lower annual emissions tightening rates for emissions-intensive, trade exposed sectors compared to other sectors, and stated that tightening rates should not apply to industrial process emissions as proposed by ECCC.
Positioning on Energy Transition: IETA has had some direct engagement with policymakers on energy transition policies, with both negative and unclear positions. In a May 2023 EU consultation response on the EU Carbon Removals Certification Framework, IETA appeared to support the inclusion of fossil carbon capture and storage (CCS) within the definition of carbon removals, which would weaken the original climate ambition of the policy. Additionally, in a June 2023 EU consultation response on the EU 2040 Climate Target, the association supported a target for industrial carbon removals with permanent storage as part of the EU 2040 Target, but did not acknowledge the limitations of industrial removals.